TORONTO: Hudson’s Bay Co (HBC) has fought to avoid a full shutdown in a Toronto courtroom, asking for permission to begin liquidating most of its stores this week.
A lawyer for Canada’s oldest company, Ashley Taylor, said HBC’s efforts to solve its cash flow crisis have “failed”.
Taylor also told a standing-room-only crowd at the Ontario Superior Court of Justice that if the retailer can’t find a workable solution with its creditors and landlords, it would need to fully liquidate.
HBC, which owes about C$1.1bil (US$770mil) in secured debt, sought authorisation to sell inventory over the next three months to raise cash.
Justice Peter Osborne adjourned the proceedings on Monday without a decision.
HBC was founded in 1670, before Canada itself, to conduct trade in a large swath of what was then British North America.
The company currently operates 104 stores and employs more than 9,300 people.
HBC owns Hudson’s Bay, TheBay.com and Saks Fifth Avenue, and is North America’s longest continuously operating company.
HBC argued in a release last Friday that avoiding a full liquidation would allow it to preserve jobs.
The company identified at least 121 key employees and 25 store locations needed for a partial liquidation process, according to Alvarez & Marsal Canada Inc, the company monitoring the creditor proceedings.
Earlier this month, the court approved a debtor-in-possession financing facility, a type of financing for companies facing bankruptcy, of C$16mil to cover operations during the liquidation period. — Bloomberg
